China Hyperscale Data Center Market Size & Share Analysis - Growth Trends and Forecast (2025 - 2031)

China Hyperscale Data Center Market Trends and Insights

GenAI and LLM training racks fuel liquid-cooling adoption

Liquid-cooling has shifted from pilot projects to mainstream practice as hyperscalers prepare for racks exceeding 100 kW. China plans 39 AI data centers hosting over 115,000 Nvidia Hopper GPUs, 70% of which will be sited in Xinjiang.^{[1]Tom’s Hardware, “China plans 39 AI data centers with 115,000 restricted Nvidia Hopper GPUs,” tomshardware.com} Alibaba proved immersion-cooling viability at scale, showing the method can dissipate 10-20 times the heat of legacy air-cooled systems. ZutaCore’s dielectric direct-chip solution lowers cooling energy by 80% and supports 1,500 W GPUs, helping operators meet government PUE targets. Beijing-Tianjin-Hebei and the Yangtze Delta are early adopters as cloud providers try to shorten model-training cycles. Huawei’s CloudMatrix 384 architecture, delivering 300 petaflops in a single supernode, demonstrates how domestic vendors integrate liquid-cooling with AI accelerators. 

Eastern Data Western Computing redistributes capacity

The national plan mandates that 60% of new compute resources be located in eight western hubs by 2025. China Mobile alone budgeted CNY 47.5 billion for computing-network infrastructure in 2024, establishing intelligent-computing centers across the west. Ningxia’s target to grow from 30,000 to 720,000 racks by 2025 illustrates the migration scale. Operators such as Tencent and Alibaba have expanded in Gui’an and Ulanqab, respectively, leveraging low-cost wind and solar power. National facilities already achieve up to 80% green-electricity usage, easing Tier-1 power congestion.

400G/800G optical backbone enables real-time cloud

China activated the world’s first 1,200G backbone spanning Beijing, Wuhan, and Guangzhou, cutting long-haul latency for AI inference.^{[3]Xinhua, “China launches ultra-high-speed next-generation Internet backbone,” xinhuanet.com} Huawei and China Mobile built the globe’s largest 400G all-optical network, supporting deterministic bandwidth for GPU clusters. H3C’s 800G Ethernet test delivered 51.2 Tbps switching at 1.085 µs latency, confirming readiness for multi-regional AI training. China Broadnet’s deployment of Huawei OTN Kepler technology shows carriers’ pivot to photonic switching to meet cloud-gaming and real-time analytics demand. The CENI research network transfers terabyte-scale 

Renewable-energy quotas spur GW-scale parks

Government guidance sets an average PUE below 1.5 by 2025 and orders that green electricity use rise at least 10% annually. Inner Mongolia and Gansu together host gigawatt wind-solar bases that backstop hyperscale campuses.^{[2]Cambridge Core, “Low-carbon Frontier: Renewable Energy and the New Resource Boom in Western China,” cambridge.org} Gansu’s Qingyang industrial park has attracted more than 300 enterprises, underscoring how data-center clustering builds local ecosystems. Advanced centers already meet the 80% green-power threshold, aided by direct-supply agreements with new energy farms. Analysts forecast that China hyperscale data center market operators will see energy savings flow through to total cost of ownership as renewable penetration rises.

Power quotas cap Tier-1 expansion

Beijing, Shanghai, Guangzhou, and Shenzhen enforce strict allocation schemes that limit new builds over 50 MW and require PUE of 1.3 or lower. Shanghai capped standard-rack additions at 60,000 to balance grid stability and digital-economy growth. Coordinated policies in Guangdong target 1 million racks by 2025, yet confine projects to designated clusters to protect urban power security. These limits divert investment toward western provinces aligned with Eastern Data Western Computing. Operators respond by adopting liquid-cooling and on-site renewables to raise per-rack density inside constrained metros.

GPU export controls create supply bottlenecks

US rules restricting high-bandwidth-memory GPUs hinder rapid AI-cluster deployment, delaying model training schedules. Nvidia introduced H20, L20, and L2 chips tuned for the Chinese market to comply with regulations. Sales restarted in 2025, yet allocation remains tight, prompting cloud providers to prioritize domestic Ascend 910B GPUs. China Mobile’s Inner Mongolia hub runs 85% locally produced accelerators, illustrating substitution trends. Continued export uncertainty pushes operators to build inventory buffers and explore non-GPU architectures while the China hyperscale data center market absorbs higher procurement costs.

Segment Analysis

By Data Center Type: self-build remains dominant as colocation accelerates

Self-builds controlled 65% revenue in 2024 because cloud majors seek bespoke architectures for AI clusters reaching 20-130 kW per cabinet. They integrate proprietary fabrics, liquid-cooling manifolds, and automation suites to optimize training throughput. Hyperscale colocation grows quickly at a 32.80% CAGR, giving enterprises immediate access to AI-ready rooms without multi-billion-yuan capex. Foreign-ownership liberalization in Beijing, Shanghai, and Shenzhen is expected to introduce global landlords, widening service choice. As a result, the China hyperscale data center market sees dual-track expansion: hyperscalers keep building owner-operated campuses, while colocation specialists scale suburban and western plots.

DCIM suites underpin both models. Operators deploy AI-driven orchestration that monitors power, coolant flow, and GPU utilization in real time. This operational maturity attracts financial investors; GDS’s C-REIT drew orders 166 times subscribed, signalling confidence in stable cash flows. Over the forecast period, the China hyperscale data center industry will balance the agility of colocation with the control of self-builds, creating hybrid capacity procurement strategies.

By Component: IT infrastructure leads and DCIM/BMS surges

Servers, storage, and GPUs represented 48% of spending in 2024. China Mobile procured 2,454 AI servers in the 2023-2024 cycle, reflecting urgency to resource knowledge-graph and video-analysis workloads. Network upgrades to 400G/800G Ethernet switches, such as IEIT SYSTEMS’ X400, lift east-west traffic capacity to 102.4 Tbps. Electrical gear—PDUs and UPS—follows server density upward, while direct-chip cooling skids, cold plates, and immersion tanks dominate mechanical budgets.

DCIM/BMS grows fastest at 33.40% CAGR because facilities exceeding 100 kW per rack require telemetry granularity unmatched by legacy SCADA tools. Huawei’s intelligent-analysis network locates faults automatically and advises energy-saving actions, shrinking mean-time-to-repair. As AI cluster complexity rises, advanced management software becomes foundational, ensuring the China hyperscale data center market operates within energy and carbon constraints.

By Tier Standard: Tier III dominates yet Tier IV accelerates

Tier III halls occupied 73% of floor space in 2024, offering 99.982% availability at moderate cost. Operators enhance basic Tier III by doubling backup lines and adding closed-loop liquid-cooling to accommodate AI loads, yielding “Tier III+” specifications. Mission-critical inference and financial records prompt Tier IV adoption, expanding at 32.20% CAGR. China Mobile’s Inner Mongolia campus exemplifies Tier IV design with dual power grids and N+2 chilled-water capacity. Regulatory frameworks in banking and government also steer deployments toward Tier IV equivalence, further diversifying the China hyperscale data center market.

By End-user Industry: cloud services lead, government demand surges

Cloud and IT services captured 50% revenue in 2024 as Alibaba, Huawei, Tencent, and Baidu scaled large-model inference platforms. China’s cloud-infrastructure spending will rise 15% to USD 11.1 billion in 2025, ensuring steady occupancy rates. The government segment, expanding at 33.90% CAGR, aggregates ministry systems onto unified computing backbones, following the “1+N+N+1” model championed by H3C. BFSI upgrades modernize core ledgers for digital yuan settlement, while manufacturers implement predictive-maintenance algorithms that cut downtime by 70 %, echoing Midea Group’s achievements. This diversified user portfolio underpins long-term growth for the China hyperscale data center industry.

Note: Segment shares of all individual segments available upon report purchase

By Data Center Size: massive sites lead, mega-scale accelerates

Massive campuses of 25-60 MW held a 40% stake in 2024, balancing modular replication with economies of scale. Operators favour this range to match grid-connection quotas while leaving headroom for phased expansion. Mega-facilities above 60 MW progress fastest at 34.50% CAGR. ByteDance’s USD 614 million Shanxi build showcases mega-scale economics where one campus aggregates compute power otherwise spread across many city blocks. Large facilities below 25 MW continue to serve edge analytics and provincial e-government but are losing revenue share as the China hyperscale data center market consolidates into multi-module giants.

Geography Analysis

East China remains the principal hub by value, anchored by Shanghai’s financial ecosystem and Zhejiang’s e-commerce networks. Power quotas spur advanced cooling and offshore-wind solutions, such as HiCloud’s underwater unit near Shanghai that sidesteps land constraints. North China records the fastest CAGR as Inner Mongolia pairs cool climate with wind-solar abundance. China Mobile’s Hohhot hub aligns with policy that channels 60% of new racks westward, demonstrating scale with 6.7 EFLOPS compute. Beijing sustains premium demand from AI research institutes, reinforcing inter-regional traffic growth on upgraded optical backbones.

South China grows steadily thanks to Guangdong’s plan for 1 million racks by 2025, leveraging proximity to Hong Kong for cross-border cloud trade. West China benefits from Qingyang’s industrial park attracting 300 firms under east-data-west-computing incentives. Central China emerges as a transit node; Zhengzhou targets a USD 56 billion digital economy by 2025, catalysing prefabricated data-center clusters near fibre crossroads . These regional dynamics confirm that the China hyperscale data center market diversifies geographically while staying tethered through national 1.2-terabit backbones.